The Inconvenient Truth about Facebook: It's Growing Despite Scandal
David Deal is a marketing executive, digital junkie, and pop culture lover.
With its latest quarterly earnings report, Facebook once again confounds the naysayers by succeeding financially and growing its global user base amid scandal. Here's what the Q3 2019 numbers say
- An increase in monthly users from 2.41 billion in Q2 2019 to 2.45 billion.
- A 29 percent year-over-year increase in revenue, with earnings per share beating analyst estimates.
The quarterly growth reflects a longer term rise in its stock value, as seen below:
In fact, Facebook might be one of the world's most resilient brands. As surely as the sun rises, someone will beat up Facebook for any number of reasons, ranging from privacy lapses to Mark Zuckerberg's hubris.
And yet, look at the company's stock price over the years. Even within the past two bruising years, people are speaking with their actions by continuing to invest their money into Facebook (I am a Facebook investor, too).
The stock sell-off of December 2018, it should be noted, was hardly unique to Facebook.
So long as Facebook keeps its user base, advertisers are going to cozy up to the platform, and investors will keep investing.
But why does Facebook keep growing? By now, shouldn't people disgusted with Facebook's scandals simply leave?
- There is a massive disconnect between Facebook's harshest critics and Facebook loyalists. A number of my Facebook friends are outspoken critics of the platform. But Facebook has 2.45 billion monthly users beyond my little bubble -- and they may simply be content.
- Facebook's vast user base just doesn't have anywhere else to go regardless of how they feel about Facebook. (Have you really tried to #DeleteFacebook and succeed?)
Maybe the answer is a combination of both. At any rate, Facebook certainly faces a real threat of a government-madated break-up.
But long term, the biggest threat Facebook's financial growth may have more to do with the surging Gen Z population than the government.
In 2019, Business Insider reported
that Facebook ranks behind Snap, YouTube, and Instagram as Gen Z's preferred social media networks.
Even then, Facebook owns Gen Z's favorite app: Instagram.
Will Facebook continue to grow despite its own problems?
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